CBO: Incentive auctions could bring down national deficit by $6.5B

The Congressional Budget Office is estimating that incentive auctions of broadcast spectrum would bring in some $6.5 billion toward reducing the national deficit out of a total $24.5 billion that would be made after compensating licensees for vacating the spectrum.

CBO doesn't spell out exactly how much broadcasters would be compensated for giving up their spectrum but did indicate that $1 billion would likely cover the payments to broadcasters who don't sell for moving out of the spectrum and to cable operators for any modifications they would  have to institute to receive signals.

"That [$24.5 billion] estimate reflects the expected value of offsetting receipts (based on the outcomes of various scenarios regarding the quantity and quality of frequencies likely to be auctioned over this period), net of direct spending to compensate existing licensees affected by the auction," the CBO wrote.

Moreover, the CBO said the amount of the incentive auction would also depend on "the willingness of two satellite licensees and dozens of television broadcasters to sell their existing spectrum rights at a price that is below the market value of their licenses."

At the same time Sen. Jay Rockefeller (D-W. Va.) has stepped up the pressure for his spectrum auction bill, which calls for an interoperable broadband public safety network paid for by proceeds of the incentive auction.

"The Congressional Budget Office's estimate reconfirms that our bill builds a robust public safety network, pays for itself, and still generates real deficit reduction," said Rockefeller in a statement. "This is just another step along the path to final passage. S.911 has strong bipartisan support, and we look forward to getting it through the Senate."

For more:
- see this Multichannel News article

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